2.5 During negotiations with NATS in mid-2002 and following the negative initial response by the Civil Aviation Authority to the Company's application for an interim review of the price caps, its four investing banks raised the possibility that they might pursue other ways of improving the Company's financial position. These included;
■ Curtailing future capital and operating expenditure to the minimum required for the purposes of meeting statutory obligations and retaining the operating licence, without provision for expansion of the air traffic control service; and
■ Disposing of parts of the business, individual assets and properties.
2.6 It is not clear whether this was a realistic threat. For example, the legislation (including the licensee's statutory duties under the Transport Act 2000), the terms of the PPP and the Company's licence restrict its freedom to shed any assets required to keep a viable Air Traffic Control system in being. Nor did it seem likely that the banks would have wished to be in direct control of such a safety-sensitive business. However, the Government, the Airline Group, the Civil Aviation Authority and NATS itself were all concerned to prevent the Company being placed in such a situation from which it could not move forward.